The Associated Press Embraces Corporatism

Back in late June of 2008, when the subtext of every AP article was “please, please vote for that Obama fella,” they published — as a straight news item — an article with the improbable headline “Everything is Seemingly Spinning Out of Control” — this in a month when unemployment was at 5.5 percent, when the Dow Jones was around 12,000, and when the financial meltdown of the fall of that year was not yet an issue in the news cycle. But that didn’t stop liberals both in and out of the media from wanting to push that snowball down the hill early, with a serious case of Depression Lust, including the AP, which went into full freakout mode with a headline and story that would quickly become a running gag for James Taranto in his Best of the Web column at the Wall Street Journal:

Is everything spinning out of control?

Midwestern levees are bursting. Polar bears are adrift. Gas prices are skyrocketing. Home values are abysmal. Air fares, college tuition and health care border on unaffordable. Wars without end rage in Iraq, Afghanistan and against terrorism.

Horatio Alger, twist in your grave.

The can-do, bootstrap approach embedded in the American psyche is under assault. Eroding it is a dour powerlessness that is chipping away at the country’s sturdy conviction that destiny can be commanded with sheer courage and perseverance.

Flash-forward to this week, and we find the AP still really wanting Horatio Alger to keep twisting in his grave, publishing — again as a news item, not an opinion piece — a story titled “Conservatives make it rough for business.” I’ve bolded the sentences that really crank up the AP-BS meter to 11:

Conservative Republicans have roughed up the business community this year – and it’s not over yet.

The U.S. Chamber of Commerce, the National Association of Manufacturers and major companies like Boeing Co. and Caterpillar Inc. all wanted quick reauthorization of the Export-Import Bank, which helps finance American companies’ overseas sales. Congress had reaffirmed the independent federal agency some two dozen times since its creation in 1934. But this year it took months of pleas, briefings and negotiations to overcome conservative opposition.

Similarly, industries ranging from asphalt to steel pressed for the popular transportation bill to rebuild the nation’s infrastructure. Conservatives wanted to give authority to the states. Nine short-term extensions later – and almost three years after the last transportation bill expired – businesses finally prevailed last month.

The business community is now pressing the Senate to ratify a treaty governing the high seas, arguing that it would open a new path to oil, gas and other resources and produce thousands of jobs. Prospects are uncertain as conservatives stand united in opposition. They condemn the pact as a threat to U.S. sovereignty.

Perhaps the most telling clue is that proponents call it the Law of the Sea Convention – shorthand LOSC – while opponents refer to it as the Law of the Sea Treaty – LOST.

Republicans like to tout themselves as the best friends of business, and the rhetoric only grows louder in an election year. They talk forcefully about their job-creation agenda and determination to undo the burdensome regulations they say arise out of President Barack Obama’s policies.

Yet when it comes to many of industry’s top legislative priorities, conservative Republican lawmakers and like-minded groups including the Club for Growth and Heritage Action have thrown up roadblocks to tasks that had been easy before the 2010 elections sent a large class of conservative tea party insurgents to Congress.

They and their ideological leaders argue that the marketplace should dictate what businesses thrive and falter, not Washington.

“What we find now is this cronyism and this corporate welfare, it’s corrupting the politics because there’s nothing now that goes through that doesn’t have a corporate interest,” Republican Sen. Jim DeMint told The Associated Press in an interview. “It’s not just the Ex-Im Bank. It’s the transportation bill that has huge entities involved. The farm bill basically guarantees large corporate farmers.”

The South Carolina lawmaker warned that the combination of big government and big industry is creating a nation that is becoming “too big to succeed.”

More after the page break.

One of the inspirations for Jonah Goldberg’s 2008 book Liberal Fascism was to explore the ramifications of corporatism; as he wrote earlier this year (behind the paywall, alas) at National Review On Dead Tree, when the original idea for LF first struck, he thought the entire book would be about economics:

The inspiration came from the CEO of the globe-spanning conglomerate Nestle — a firm so enormous it wouldn’t surprise me if “Nestle” is actually Swiss French for “Ram Jack Corporation,” or maybe “Skynet.” I was in Switzerland on the sort of junket I naively thought I’d soon be going on a lot more of.

As I listened to the CEO talk about his company’s relationship with the European Union, the UN, various NGOs, and his competitors, it became very clear that he didn’t really care much about free markets. Oh, sure, he liked a little competition for efficiency’s sake among his vendors and suppliers, but basically, he saw Nestle as bigger than all of that — and apparently, so did the various world leaders he dealt with.

Hardly an earth-shattering insight, I know. But it got me thinking about how feckless big business is when it comes to fighting for free-market principles. It also illuminated how big business really doesn’t mind regulations, if the regulations help them secure market share and prevent other firms from competing.

That’s one of the reasons the health-insurance industry was perfectly fine with being thrown into the briar patch of Obamacare. Thanks to the individual mandate, the law protected the big insurance companies by turning them into de facto utilities.

The example I usually use for this sort of thing is the Americans with Disabilities Act. Big corporations didn’t object to it much because they understood that they could pass the costs on to consumers, while the burden of the regulations would prevent smaller, nimbler firms from competing.

When I make this point, people who don’t want to understand its implications look at me funny. “You mean big business likes . . . big government?”

Politically favored businesses of course benefit from direct subsidies (think agribusiness) and government loan guarantees (think Solyndra and Boeing), but Mitchell makes the important point that regulation itself creates a privileged class.

Regulation often acts directly or indirectly as a barrier to entry. The conservative and libertarian media have documented this anecdotally — Philip Morris supported and is benefiting from Obama’s tobacco regulation, for instance, because the rules allow it to lock in its dominant market share. Mitchell assembles scholarly work broadly showing regulation’s anti-competitive and pro-big-business effects.

These critiques of regulation come not only from Milton Friedman, but also from the Left. For instance, liberal activists Ralph Nader and Mark Green wrote in the Yale Law Journal that the “regulatory system undermines competition and entrenches monopoly at the public’s expense.” Mitchell in this section also cites Alan Krueger, who now heads Obama’s Council of Economic Advisers.

In the Obama era, as Democrats and the media try to paint deregulation as some sort of dangerous sop to big business, Mitchell’s notion of “regulatory privilege” is a crucial tool for dismantling the old narrative that regulation protects the public. Mitchell uses a colorful image to make his case: Bruce Yandle’s “bootleggers and Baptists.”

Illegal booze smugglers, Yandle wrote, “support Sunday closing laws that shut down all the local bars and liquor stores. Baptists support the same laws and lobby vigorously for them. Both parties gain. …”

Locally, for instance, the Restaurant Association of Metropolitan Washington is lobbying for strict rules on food truck parking, in the name of “the needs of the public” for sidewalk space and parking places. Of course, brick-and-mortar restaurants benefit from any regulation that makes life harder for their rolling competitors who can’t afford to lease a downtown storefront.

The research Mitchell brings together helps show why government-granted privilege is so important to big business and so costly to the rest of society. In one key finding, he highlights research indicating that free markets, with fewer barriers to entry and fewer bailouts to prop up failed giants, make it harder for dominant businesses to maintain dominance.

Noting the passage in the AP article that congressional Republicans”and their ideological leaders argue that the marketplace should dictate what businesses thrive and falter, not Washington,” blogger Ace of Spades responds:

Yes, that’s so controversial.

Remember the days when Democrats (and their media Spirit Squad) railed against Republicans for “favors to big business”? Well, the Democrats have changed their position, and the media has quickly followed suit.

But the difficultly with the story line that AP tried to push this week is that despite the increasingly left-leaning tilt of the business world, it’s rather difficult to turn on a dime nearly a century of conventional wisdom that Republicans = big business. Even Winston Smith would find trying to advance the narrative that “Conservatives make it rough for business” to be a hard sell.

Besides, after watching Occupy Wall Street gang-up on business in the fall of 2011, more than a few people would look at a headline that “Conservatives make it rough for business” as a good thing, to be encouraged. Maybe even wish they’d bring the pitchforks a little more.

OK, maybe that last thought is stretching it a bit. But nowhere near as much as AP tried to do this week.

14 Comments, 10 Threads

1.
buddy larsen

Isn’t AP now owned by Reuters? Isn’t Reuters –even as sanitized ‘Thompson Reuters’ –owned/controlled by the Rothschild banking family –owner/controllers of Standard & Poor’s, the rating agency gleefully slapping all those platinum AAA ratings on all those community-organized and TooBigToFail bank-securitized ninja loans that became the base of the ”toxic assets” that have grossly –grotesquely –punked the entire western world?

And didn’t Standard & Poor’s then move a mountain of gold to George Soros and the hedge funds of the Managed Funds Association –all deep-shorting USA –with that last-August US debt downgrade which knocked a thousand points off the DJIA?

So on this alone, just on this alone, why on earth would anyone believe that AP is anything but one of the ignorant armies of the institutions run by that few mad-visionaries holding sway in the big & old corporate treetops who are –with the finest of intentions (cough) –cooperatively secretly trying to crash the economy, the currency, and the culture of the USA as the last stronghold against the global Court of the Oligarchs, the one-world government, the New World Order, where every brilliant acolyte will be the king? Of something or other, probably, maybe, anyway, doncha think?

Excellent insights! I recall James Burnham’s “The Managerial Revolution” (I believe around 1940) in which he outlined morphological parallels between Soviet Russia, National Socialism (which implies also fascism) and the New Deal. A key element of the parallel entails placing the centralization of economic decisions in the hands of the “managers” (a term suggestive that, I hold, needed refinement) as opposed to the entrepreneurs. The Soviet version has faded away to be replaced morphologically with the state corporative model of Mussolini (and Hitler), even in today’s Russia. I suggest that successful (relatively speaking) “socialist” systems are morphologically fascistic, i.e., they evince state corporatism. Many on the American left complains that the “rich” are hogging up 90% of the profits vs the 10% left for the workers or non-rich. The paradox here is that the Obama “socialist” remedy is morphologically productive of the very state corporatism today that, in the past, favored the “rich” of the fascisms of the 1930′s. One stress factor on middle class survival is corporatism. I find the article phantastic, but I bet it will make no impression on the believers in class warfare. That drama is too apocalyptically stimulating!

Yessir, i think you are right, and from all sorts of angles, including the essential paradox of the class-warriors/underclass/sans culottes energetically blocking their own escape routes from the very condition that incites the very blocking, and at the behest of their only natural political enemy the overclass/aristocracy/citizens committees (which will lop off a few powdered wigs when possible, in order to functionally replace them).

The middle class/kulaks/bourgeoisie, living heliotrope-like inside a natural objective world of intrinsic merit-order that cannot be sensibly turned upside-down, literally cannot believe the ascending perversity –until the literalism explodes and –oh, what –Eric Holder holds a press conference dressed in an SS uniform, and nobody laughs?

‘Survival of the fittest’ having literally wired Hominid optic nerves directly to our ancient reptilian vestigial nerve and adrenal systems, the drawing rooms of our Founding Fathers, sensibly built on high ground way up there in the frontal lobes, will forever be a little distant from the direct impulse action.

The famous guillotines of France’s ten-year-long European version of our Revolution, were nothing like a long term permanent feature of that era’s New World Order –they were brought into play only in Paris, and only for one hot summer long into the decade of revolution, at the point where the effete and Obama-like Robespierre had begun to panic over his personal prospects of success.

That summer 30,000 enemies of the state (equivalent to, guessing, 200,000 of today’s Parisians?) were trundled to the chopping blocks, in a sort of palace paroxysm of despair left raging on the spot where all of Utopia’s stockpiled building materials kept weathering away before the Citizen’s Committees could agree to deliver any blueprints to the carpenters.

I think it is important to recall that the Progresive movement, in its initial stage, called for deference to experts, not to socialist revolution. I spelled that out here with months of research into The Nation magazine in 1919. See http://clarespark.com/2009/09/19/populism-progressivism-and-corporatist-liberalism-in-the-nation-1919/. But with the 1930s Depression, communists made enormous inroads into what had been a conservative reform movement of “moderates.” Otherwise I tend to agree with Professor Wessell. Today, the lines between communism and social democracy, with similar appeals to class warfare, is a sea change from 1919. We might say that the communists did their cultural work very well indeed, as Obama pits class against class.

What we have globally is Corporatism on steroids. I have been in official public/private meetings where the Career Pathways for all students in K-12 is unveiled and I point out that this assumes a managed, government directed economy. The advocates who are employed by Big Business exclaim that this is what the Chamber of Commerce, Business Roundtable, and NAM all want. As if that refutes what I just said instead of confirming it.

There’s a reason all these bad education reforms coming in under various aspects of this administration’s Common Core push keep referring to Joseph Schumpeter. Unfortunately for them some of us have read him. We understand that Schumpeter would not be promoting a government-Big Business-research university nexus to “Manage” the unpredictabilities associated with Creative Destruction. He understood that nexus would be about shutting down innovation.

Last week this Administration’s National Research Council put out a report on computer research on sustainability that proposes using the tech companies to gather the data necessary to manage people and the economy to support multi-generational sustainability.

No wonder the tech companies are pushing so for these ed reforms. I just thought they wanted to sell all the hardware and software to the schools for that lucrative piece of Corporatist revenue. But no, these companies are being led to believe they are to be lead players in a system of systems/Green Growth/sustainable global economy where government bureaucrats and their cronies facilitate most future commerce.

This will not end well unless it is better understood by many people. And soon.

The likely end goal of the current “progressives” in the U.S. is analogous to the National Socialist vision for Germany circa 1934. With Holder at the DOJ we can clearly see that all of the elements of repression that existed in the ’30s in Germany are in place in the U.S. of today. The Government now has something on the order of 20,000 criminal statutes at its fingertips to say nothing of the hundreds of thousands of pages of rules and regulation to use in enforcing just about anything Uncle Sam wants to do.

If the Left wins the election of 2012 and returns to control of both Houses of Congress then we can expect to look back at 2007 with longing. Of course, that part of history will be erased quickly and no longer taught because, you know, we need to preach about the greater glory of the greater Left.

By the way, never let anyone get away with feeding you the line that Fascism is a right-wing ideology. It is one tick to the right of Russian Communism, but it has nothing to do with freedom of the individual, the right to property, and the other tenets of conservatism.

Big institutions supporting other big institutions is nothing new. During medieval times there was tension between kings (& their feudal system) and the Catholic church over who was the top dog. But by and large they supported each other as a way of controlling the great unwashed masses.

The history of how the left turned “fascism” into a designation of the “right-wing” cannot be told here. However, in Germany of the past the fascistic (sic )”NATIONAL socialism” manifested itself in extreme nationalism, partriotism, hate for foreigners (and it a perverse way Jews were seen as very foreign). The so-called “fascists” of today, particuarly in the former East Germany, do manifest all the nationalistic symptoms of this former nationalism plus their tendency to violence (cf. just the SA of the pre-power days of Hitler), though there just not enough Jews around to slug — a different matter in France.

This use of the term is today’s “politically correct” vocabulary and there is nothing that can be changed. So I accept it. However, I do not find it correct to subsume as pure equivalence national socialism under fascism (Mussolini resisted racism for a long time, even had Jewish support whereas as Hitler’s “fundamental belief” -his words translated- was the annihilation of the Jews). It is true that the fascism of the 1920s and 1930s was NATIONALISTIC in excess. In this sense it can be carried over the cover term for “NATIONAL socialism”. And such tendencies today are found in violent prone groups in Germany, who openly read Hitler, all of which allows the term’s use for the “right-wing”.

However, the use of “fascism” as a cover term allows the left to overlook the reality of “national SOCIALISM”, i.e., the “managerial organization” (I refer to James Burnham’s “The Managerial Revolution” of 1940 — I just heard in a documentary in German tv Albert Speer referred to as an example of the managerial revolution) that is constitutive of soviet socialism, German socialismm and FDR proto-socialism and resurfing in Obama socialism. In other words, the left is not forced to reflect on its own socio-economic “socialism” with its morphological similarities to Nazi socialism and Mussolini socialism, vis., fascism. Sadly I must utter a word of caution, the left’s with its implicit “socialism” is in some quarters (e.g., Günther Grass and the de-legitimizers of Israel) has begun to exude the scent of being not just in opposition to a specific Israeli gov., but in the depth of the unconscious to harbor a residual anti-semitism. I do not wish to overplay this suspicion. It is there and the recent German Court ruling against circumcisions worries me.

Great post! The story that that first illustrated this clearly for me was hearing that Big Toy lobbyists wrote the legislation to curtail lead in toys. As a result the law requires that all toys be subject to testing by independent labs for lead content. Toys manufactured by Mattel, however, are exempt; their toys can be tested in-house by their own technicians.